Arms and armour: With military and defence contractors, like ST Engineering, Northrop Grumman and Lockheed Martin accounting for over half the presence in Singapore this week, most of the deals are likely to be in this area

But in the minds of many industry players, 2008 and 2009 probably rank as the two worst years of the past decade, with total global airline losses at US$20 billion. A collapse in passenger travel - especially in premium ticket sales - and air cargo shipments saw airline revenues plummet some 25 per cent.

And as Iata pointed out last week, 2009 was the worst year for global aviation in 60 years.

According to Iata, passenger demand in 2009 fell 3.5 per cent with an average load factor of 75.6 per cent, while freight suffered a full-year decline of 10.1 per cent with an average load factor of 49.1 per cent.

The Asia-Pacific, the fastest growing and potentially the largest aviation market by the end of this decade, was particularly badly hit.

The member airlines of the Association of Asia Pacific Airlines association - which include some of the world's strongest players like Singapore Airlines, Cathay Pacific, Korean Airlines and Qantas - reported a 5.7 per cent drop in passenger carriage and an 11 per cent drop in cargo in 2009. Revenue passenger kilometre fell 6.5 per cent, while available seat capacity was cut by 6.1 per cent.

Airlines around the region, which had gone on a wild buying spree in 2007, suddenly found themselves grounding planes, shelving fleet expansion plans and deferring deliveries. And the aftershocks of the trauma of the past two years continue to be felt here as the world's largest airline, Japan Airlines, struggles with its US$27 billion bankruptcy.

Coming just three months after the Dubai Airshow, and just as the first signs of recovery are showing, the 2010 Singapore Airshow could provide a critical gauge of the strength of this recovery.

At Dubai, Boeing announced a meagre order for 11 B737 jets from Air Algerie and Tassili Airlines. Airbus reported firm orders for 15 A320s from Senegal Airlines, Nepal Airlines and Yemenia in a deal worth some US$3.6 billion. In all, manufacturers sealed just US$13 billion of orders - less than a tenth of the US$155 billion worth of deals signed two years earlier.

For the whole of last year, Airbus and Boeing received new orders for 310 and 263 planes respectively - amongst their lowest numbers this decade.

Given the fragile state of the industry, it is too early to expect any big plane orders to be announced in Singapore this week.

With defence contractors like ST Engineering, Northrop Grumman and Lockheed Martin, and country defence teams from Israel, the United Kingdom and elsewhere accounting for over half the presence in Singapore this week, most of the deals are likely to be in this area.

While no major orders are expected in civil aviation, the announcements and pronouncements made this week in Singapore will provide valuable insights into the risk appetite, purchasing power and strategies of industry players for the year ahead. The industry will also be closely watching planemakers, defence contractors, MRO players and suppliers to get an insight into new technologies heading their way as a new decade dawns.

Aviation is a strangely fascinating business.

It has a greater propensity to lose money than most other businesses and provides investors a return of less 5 per cent on average. It also has one of the highest rates of failure for any major industry. As one would put it, to become a millionaire, just invest a billion dollars in an airline.

Yet, despite this, and the threats from terrorism, pestilence and economic malaise, this is an industry which attracts huge amounts of capital year in and year out. It is also a business where technological genius, creativity, ego, ambition, disappointment, desperation and hope are always in full display. And it all comes together again this week, right here in Singapore.